Why Home Value is Important to Homeowners
The value of a property is most important when a homeowner is making a purchase and when they decide to sell. However, even if a homeowner is not looking to sell in the near future, it is still important to know what the home value. It can help a homeowner decide if they need to make renovations or updates before they do sell.
The Home Value of the Property
A simple way to get an idea of how much a property is worth is to use an online real estate website. There are many websites that have general data about houses and the real estate market in that area. Entering in the properties address will bring up an estimate of what the property could be worth. This will be based on what other homes have sold for and information about the property, such as square footage.
Note that these tools provide ballpark numbers. While this is a good starting spot, it is not a hard and fast home value determinant.
A Professional Opinion
A real estate agent is a good resource for pricing on a home. They know the local market and have seen comparable homes that have sold recently. This will give them a more accurate picture of what the home is worth with its current features.
When comparing homes, it is important to compare similar properties. The homes should have the same amount of bedrooms and bathrooms, and the square footage should be similar. The lot size is important if there are multiple lots being sold. Typically, residential properties in one neighborhood will have similar lot sizes.
Judging a Sale Price
If serious about selling, it is important to pay close attention to other properties in the area. Comparable properties that are for sale must have a similar price. If there are similar homes on the market that are set at $200,000, that should be around where the home is priced. Going too much higher will mean that the property will be ignored in favor of better priced homes.
Setting the Price
Before putting a house on the market, a homeowner will have to set a price. This can be difficult because the fair market value does not always reflect what people are willing to pay. These values can also land on strange increments.
It is also best to round values down or up. For example, avoid selling a property for $222,000, and instead put it on the market for $220,000. By dropping the price by $2,000 it will appeal to more buyers. Most buyers will set limits while searching for properties. This additional $2,000 may push them out of their price range and they will never see the property during a search.
Do Not Allow Feelings to Cloud Judgment
This is a difficult task. It is hard to separate facts from feelings when looking at a family home. When judging the price of the property, many homeowners make the mistake of valuing the property higher because of their love for the house.
The property may also have dropped in value since it was purchased. In this case, the homeowner is not going to get their money back from the investment. Renovations that have been completed over the years do not always mean a higher price, either. Most homeowners only see about sixty percent of their renovation costs repaid.
Accurate Pricing is Vital
While it is a difficult process, putting a property up for sale with accurate pricing is vital. A price that is too high is going to damage the homeowner’s chances to sell their home. Houses that are overpriced sit on the market for months without any offers. Buyers are smart and they will know if a property is overpriced.
Putting a house on the market for too little is also dangerous. There are some areas where the market is hot and the price is pushed back up as buyers try to compete with each other for a property. However, in a market that does not have buyers, fighting over properties priced too low may force a homeowner to sell for a low value.
Pricing a house is difficult but a necessary step. It can be beneficial to get an estimate online before looking to sell. Keep in mind that the home value can change drastically throughout the years, and a homeowner must play it smart to avoid losing too much money when they decide to sell.